Hot Market for Iced Beverages

The overall value of the iced and blended beverages market in UK coffee shops has grown by 18% p.a. in 2016 to reach an estimated £338 million turnover, according to the latest research by Allegra World Coffee Portal. The category currently accounts for 3.8% of the total coffee shop market sales, an increase from 3.6% sales share in 2015.

The Iced Beverages 2017 report, part of the Project Café UK Series from Allegra, observes that sales growth in the iced and blended beverages category has outperformed the growth in the overall coffee shop sector, which increased by 12% to hit £8.9 billion turnover in 2016.

Growth in the category was driven in part by an increase in prices, but also by a rise in consumer participation. As more operators offer a wider range of iced beverages, and for longer, the growth is set to continue through 2017. Seasonality is starting to show signs of stretch, with the established May to September season expanding into the April and October months. A recent consumer study conducted by Allegra World Coffee Portal shows that habitual uptake is developing and 1 in 5 consumers are buying iced beverages all year round.

Market trends

As the health & wellness trend takes hold, and the ripples are felt throughout the entire UK coffee shop industry, operators have been forced to offer a wide range of iced beverages to meet consumer demand for healthy indulgent treats. Leading brands are innovating with flavours, and delivering authentic, handcrafted beverages across the range.

According to the consumer study, the most important attributes when choosing an iced beverage are the use of fresh ingredients, good value for money and that the beverage is freshly prepared from scratch. Pre-prepared iced beverages came in as the least important attribute to the consumer.

The future outlook and opportunities for growth

As the category grows, all operators will need to step up to the mark with freshly made iced beverage and blended smoothie offerings to attract and retain the increasingly health conscious consumer. The most innovative short-term development will be the growth of cold brew and nitro coffee, with high street chains following on from Starbucks’ lead. With continued innovation from the branded chains, Allegra World Coffee Portal expects to see 17% CAGR growth from the category in the next five years.

Iced Beverages 2017 is now available for purchase from Allegra World Coffee Portal.

For more information and pricing, please call +44(0)20 7691 8800 or click here todownload a brochure.